“Clean energy is one of the greatest economic opportunities of all time”: John Kerry

Ilario D'Amato
Reading time: 3 minutes
12 March 2015

NEW YORK: The US Secretary of State John Kerry has praised sub-national governments’ role in tackling climate change and highlighted the fantastic economic opportunities of the low carbon energy pathway.

The Secretary delivered his remarks during one of the ‘Road to Paris Climate Series’ events organized by the Atlantic Council in the US this morning, which aims to draw business and social attention to the important Conference of the Parties global climate talks in Paris this December.

“I am keenly aware that we can do a better job of engaging the private sector and our partners at the sub-national level of government in this effort,” John Kerry said, pointing out the difficulties and the opportunities arising from dealing with climate disruption. “And I can tell you today that I plan to make certain in the next months that that happens.

I know many of you have already made impressive announcements, those of you engaged in business or on the boards of an enterprise or eleemosynary or educational institutions. And you’ve helped to lay out how we can combat climate change, and I thank you for doing that. But now it’s time to build on those pledges. Let us know how you are doing. I say let us know through the State Department, and how we can help you make progress. And this is the kind of shared resolve that will help ensure that we are successful in Paris and beyond.”

Sub-national governments are at the core of The Climate Group States & Regions program, a coalition of the most forward thinking state and regional governments that collectively accounts for 313 million people, 11% of global GDP and 2.3 Gigatons CO2e. The network helps states and regions, which are committed to grasp the economic and social benefits of the low carbon pathway, to share their expertise and experiences, to have an impactful single voice to shape global climate action. The importance of the program is underlined by the fact that so far, nine members have already committed to reducing their emissions by 80% or more by 2050.

“Even at the centers of international and national policymaking, there is a growing recognition that nations are not going to solve this problem on their own,” remarks Evan Juska, Head of US Policy, The Climate Group. “Businesses, states, regions, and cities will all play an integral role, and many are already leading.

“Through pacts like the Compact of States & Regions and the Compact of Mayors, sub-national governments are showing the way forward, setting strong goals and backing them up with clear action.”

The Compact of States & Regions is an initiative backed by the UN and implemented by The Climate Group States & RegionsCDPR20 and nrg4SD to gather, for the first time ever, a global account of the greenhouse gas reduction targets set by state and regional governments. Having a single, transparent and coherent measurement system will help to compare commitments and effective pollutant reductions – and ultimately it is hoped will spark informed public discussion.

states and regions map

Image: The Climate Group States & Regions members


The largest market of all time

During his speech today, John Kerry pointed out how tackling climate change is a win-win solution both for the environment and the economy: “Clean energy is not only the solution to climate change, it is also one of the greatest economic opportunities of all time,” he said. “The global energy market of the future is poised to be the largest market the world has ever known. We are talking about US$6 trillion market today, with four to five billion users. That would grow to nine billion users over the next few decades.

“By comparison, the great driver of wealth creation in this country in the 1990s, when super-billionaires were created and every income level of America went up, that was technology market. And that was a US$1 trillion market with only 1 billion users.”

John Kerry also looked at the investments necessary to spur the clean revolution: “Between now and 2035, investments in the energy sector are expected to reach nearly US$17 trillion,” he said. “That’s more than the entire GDP of China. You have just to imagine the opportunities for clean energy. Imagine the businesses that can be launched, the jobs that will be created in every corner of the globe. Actually, you don’t have to imagine it. All you have to do is looking at the results that we are already seeing in many places.”

In 2007 the US state of Massachusetts, for example, pledged to build 2,000 megawatts of wind power capacity by 2020, and more than 250 megawatts of solar power by 2017. Today it has increased its renewable energy by 400% in the last four years alone, thanks to a bulk-purchasing program for residential solar that has helped to keep prices low for residents and businesses across the state. There are residential solar installations in 350 of 351 Massachusetts’s cities and towns.

“Today, the commonwealth’s clean energy economy is a US$10 billion industry that has grown by 10.5% over the past year and 47% since 2010. It employs nearly 100,000 people at 6,000 firms, and it’s the perfect example of how quickly this transformation could happen and how far its benefits reach”, the US Secretary added.

John Kerry

Image: The US Secretary of State John Kerry delivers his speech at opening of Climate Week NYC last September.

Good policies attract investments

Crucially, John Kerry pointed out that good policies are fundamental to attract these economic opportunities: “It’s much easier for businesses to deploy capital when they have confidence in the local legal and regulatory policy”, he stressed. “And to attract money, we need to control risk. The more you can minimize the risk, the greater confidence people, investors will have to bring their capital to the table”.

Speaking of policy solutions, John Kerry underlined the importance of energy policy: “With the right choices, at the right speed, you can actually prevent the worst effects of climate change from crippling us forever,” he said. “If we make the switch to a global, clean-energy economy a priority, if we think more creatively about how we power our cars, heat our homes, operate our businesses, then we still have time to prevent the worst consequences of climate change. It really is as simple as that. But getting there is proving not to be as simple.”

Kerry remarked that 2015 is “a critical year. We know that even the agreement we are trying to reach in Paris will not completely and totally be able to eliminate the threat. But it is an absolutely vital first step, and it would be a breakthrough demonstration that countries across the globe now recognize the problem and the need for each and every one of us to contribute to a solution. And it will set the market moving; it will change attitudes; it will change governments. And then progressively, no one can quite measure what the exponential productivity of all of that effort will produce.”

Economic benefits

Finally, Kerry pointed out how delaying climate action will be dangerous and costly. As he observed during the opening of Climate Week NYC last September, “it doesn’t cost more to deal with climate change; it costs more to ignore it. But despite the scientific consensus we are collectively still allowing this problem to grow, not diminish. It is absolutely imperative that we decide to move and act now. The United States is prepared to take the lead in order to bring other nations to the table.”

Today, he pressed the same issue underlying that “in economic terms, this is not a choice between bad and worse. Some people like to demagogue this issue. They want to tell you, ‘we can’t afford to do this.’ Nothing could be further from the truth. We can’t afford not to do it. And in fact, the economics will show you that it is better and cheaper in the long run to do it. So ultimately, this is a choice between growing or shrinking an economy. Pursuing cleaner, more efficient energy is actually the only way that nations around the world can build the kind of economies that are going to thrive for decades to come”.

Video: US Secretary of State John Kerry's speech at the ‘Road to Paris Climate Series’ event by the Atlantic Council

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